China to increase health care subsidies, deepen reform

By Reuters

May 10, 2015 08:15 AM EDT

China will increase its healthcare subsidies by 19 percent this year as part of efforts to deepen social reforms and strengthen safety nets, the government said on Saturday.

Government healthcare subsidies for qualified urban and rural residents will be raised to 380 yuan ($61.21), from 320 yuan last year, the cabinet said in a statement posted on the website of the National Health and Family Planning Commission.

Measures will also be taken to reduce the cost of drugs and medical checks, reform the salaries of healthcare workers and increase the availability of doctors in rural areas, the statement said.

China has a scarcity of doctors, partly caused by low wages. That has led to bottlenecks at hospitals, and doctors sometimes accept bribes from frustrated patients who want to receive better medical attention.

Out-of-pocket expenses for patients can also be high due to low insurance coverage.

Economists say it is crucial for China to improve the quality of its healthcare if it wishes to remake its economy and boost domestic consumption. They say a stronger safety net will encourage Chinese to spend more and save less.

As the world's most populous nation, China's heathcare bill is estimated to hit $1 trillion by 2020, according to consultancy McKinsey & Co.

The government had said in March it would double the number of general doctors by 2020.

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